Health Check: Less pain at Mayne after knock-out court win

• The NSW Supreme Court has, in effect, ruled against Cosette’s attempt to abandon its $670m takeover of Mayne Pharma
  
• Cogstate posts record quarterly sales on the back of surging demand for depression and schizophrenia testing
• Aroa posts strong September quarter sales and maintains full-year guidance

Mayne Pharma (ASX:MYX) appears to have gained a victory in its acrimonious takeover battle with Cosette Pharmaceuticals, after the NSW Supreme Court rejected Cosette’s attempt to retract from its $672 million scheme arrangement.

Cosette had tried to withdraw from the scheme of arrangement, arguing a “material adverse change” in Mayne’s performance.

The court dismissed Cosette’s claims.

“Mayne Pharma will now take all steps within its power to implement the scheme,”  Mayne says.

“The scheme remains subject to certain conditions precedent, including receipt of Foreign Investment Review Board (FIRB) approval and the approval of the NSW Supreme Court at the second court hearing.”

This hearing is scheduled for next Wednesday and Mayne expects the scheme to become effective the next day.

The company maintains shareholders will be paid on November 3.

Cosette launched its $7.40 a share cash offer on February 21. After Cosette sought to terminate the deal, the stock plunged to as low as $4.35 in mid May.

This morning, the shares climbed as high as 15%. The last time we looked they were 12% higher at $6.33, which means there’s a quick 17% on the table for investors convinced that this is the endgame.

Is it really all over?

It’s not over until the fat lady sings – and Mayne banks Cosette’s cheque. Conceivably the suitor could play hardball from distant parts.

FIRB intervention is possible, but unlikely.

Cosette has threatened to close Mayne’s cornerstone facility in Adelaide, prompting the South Australian government to urge FIRB to step in.

An arm of federal treasury, FIRB deliberates in a mysterious manner. But it has proved reluctant to intervene in takeovers.

Cogstate’s sales soar … 

Cognitive testing house CogState (ASX:CGS) is riding a wave of demand for its services in clinical trials, with the company reporting a strong uptick in September quarter sales.

Ahead of today’s AGM, the company said “sales contracts” rose 88% to $21.4 million, the second strongest quarter on record.

Chairman Martyn Myer told the gathering that in prior years, Cogstate relied on Alzheimer’s disease programs. But that’s not so much the case now.

“While Alzheimer’s was important to our [full year] revenue result, the growth also came from other areas, such as sleep and rare diseases,” Myer said.

“Across the industry, we saw renewed interest in schizophrenia and Cogstate is pushing aggressively into mood and psychiatry disorders.”

Indeed, the numbers show Alzheimer’s disease trials accounted for 56% of sales in the year to June 2025, but 33% in the quarter.

Partly driven by interest in psychedelics, depression trials spoke for 17% of quarterly revenue compared with 5% for the year.

Schizophrenia testing came from the clouds. The condition accounted for 14% of work for the quarter, but only 2% for the year.

Management guides to December half revenue of $23.9 million, up 18-20%. That’s about on par with the June half tally of $29.1 million.

However, don’t expect the top-line surge to translate to the bottom line.

Management warns margins are likely to contract up to three percentage points, owing to the company expanding into psychiatric disorders and investing in AI.

Cogstate reported revenue of $53.1 million for the year to June 30, up 22% and almost doubled net profit to $13.9 million.

“The quality of [Cogstate’s] revenue mix is now more diversified and improved, both in terms of indications and with reach to more biopharma customers,” opines broker Canaccord.

Cogstate shares climbed up to 6%, taking their 12-month gains to 188%.

 … while Aroa is a goer as well  

NZ-based wound healing house Aroa Biosurgery (ASX:ARX) has confirmed its full year guidance after a robust September quarter.

Aroa reported receipts of NZ$23.5 million ($20.6 million), driven by record sales of the company’s Myriad product for large complex wounds and lower limb salvage.

The Kiwis use an agrarian-based March year end, which makes the September quarter the end of the first half.

Receipts for that stanza came in at just under NZ$46 million, compared with NZ$37.7 million for the previous September half.

Aroa will report its first half numbers in full on November 25.

Aroa’s products are based on extracellular matrix platform, derived from sheep stomach material.

Other key products are Symphony (complex chronic wounds) and Ovitex (hernia repair and breast surgery). Aroa provides the latter to its is Nasdaq listed partner Telebio.

The company says a pending change in public US reimbursement should be positive for Symphony sales.

In the meantime, Ovitex sales are tracking to expectations and “Telebio remains confident regarding their sales outlook and financial position.”

All eyes on CSL ahead of US jamboree

CSL (ASX:CSL) watchers are honing their sums on the blood plasma and vaccines giant ahead of the company’s Capital Markets Day, actually to be held over three days in the US from November 4.

The event will attract elevated interest, given CSL’s recently announced cost savings blitz and the proposed demerger of its Seqirus vaccines arm.

In the background, Trump’s pharma tariff and Most Favoured Nation drug pricing policy have scared the bejesus out of investors (rightly or wrongly).

UBS’s healthcare analysts have modelled the Seqirus demerger.

The conclusion? The bifurcation should produce “modest gains”, but it gets tricky.

“Our analysis points to modest initial benefits from the demerger, with some limited valuation capture and earnings risk reduction,” the firm says.

The demerger is likely to “concentrate” CSL’s current undervaluation into Seqirus.

This creates an opportunity if Seqirus can navigate the shoals of Trumpian health policy.

UBS expects Seqirus’ earnings to grow by 5% percent per annum between 2026-27 and 2029-30, “underpinned by a recovery in flu vaccination rates and modest margin expansion.”

Back of the bus

Meanwhile, Bell Potter’s analysts won’t be getting a seat next to CEO Paul McKenzie on the minibus to site tours of the company’s plasma facility at Kankakee and vaccine factory at Holly Springs.

Already one of the least bullish on CSL, the broker has reduced its ‘price target’ on the stock, to $230 from $240 previously.

The firm has shaved its CSL earnings forecasts in the 2026-27 and 2027-28 years, by 3% and 6% respectively.

A key reason is that CSL’s vaunted $525 million of costs savings are likely to be reinvested to drive more “pipeline opportunities”

So, they’re not really savings, we guess.

One such opportunity is to avail of an option to acquire Dutch company  Varmx, which is developing a blood-clotting treatment.

In a deal announced in mid-September, CSL provides an up front payment of US$117 million and funds Varmx’s phase III trial.

Having been trashed post CSL’s full-year results and strategy Big Reveal, the shares have edged up 7% over the last month.